Public Works Fleet Services Inventory Controls - June 2011

Department of Public Works Fleet Services Inventory ControlsReleased June 2011Download the Full Report hereDownload highlights here

We undertook this audit because of risks we identified in our 2008 audit of fleet services and due to the inherent risks in managing inventory. The recorded value of fleet services’ inventory of vehicle parts was $1.9 million as of March 1, 2011.

We found:

The Office of Fleet Services’ inventory records overstate the total value and number of items on hand, which indicates potential for theft or fraud and reduces operational efficiency

As of March 1, 2011, about 18,000 parts, valued at about $500,000 of fleet services’ $1.9 million parts inventory, had no physical location recorded

Employees were not conducting monthly counts of parts inventory, as required by fleet services’ written policies

Dual data entry into inventory and Oracle systems weakens the controls in each system intended to separate incompatible duties and ensure items are accounted for when received

We observed security risks at all facilities except the airport locations, including inadequate lighting, unlocked rooms, rooftop access, a damaged perimeter fence, and distribution of keys to multiple people